freedom of association and the effective...

FREEDOM OF ASSOCIATIONAND THE EFFECTIVE RECOGNITION OF THE

RIGHT TO COLLECTIVE BARGAINING:A REFLECTION UPON OUR FUNDAMENTAL COMMITMENTS

Brian Langille

International Labour OfficeGeneva

Freedom of Association and the Effective Recognition of the Right to Collective Bargaining: A Reflection upon our Fundamental Commitments 1

“Justice is the first virtue of social institutions, as truth is of systems thought.”

John Rawls, A Theory of Justice (1971) 3

“There is a deep complementarity between individual agency and social arrangements. It isimportant to give simultaneous recognition to the centrality of individual freedom and to theforce of social influences on the extent and reach of individual freedom. To counter theproblems that we face, we have to see individual freedom as a social commitment.”

Amartya Sen, Development as Freedom (1999) xii

“We cannot adopt a system in which the macroeconomic and financial is considered apartfrom the structural, social and human aspects, and vice versa. Integration of each of thesesubjects is imperative at the national level and among the global players.”

James Wolfensohn, “A Proposal for a ComprehensiveDevelopment Framework” (January 2, 1999) 4


What is the normative salience of the rights of freedom of association and collective bargaining atthe turn of the millennium? The timing of this question could not be more provocative or interesting. Weare at a moment in time in which the tectonic plates of our normative thinking are shifting into a newalignment. Spurred on by both the threats and promises of our increasingly integrated world, received ideasabout our most fundamental questions concerning the governance of human affairs - the relationshipbetween the public and the private, between markets and politics, and between the economic and the social- are now subject to a refreshing scrutiny and reappraisal. Our task here is to make a critical contribution tothat scrutiny and reappraisal by focussing upon the foundational values of freedom of association and theright to collective bargaining. We seek to clarify what is at stake and here, to sort out our basic social,economic, political and ethical commitments concerning these values and their relationship to our ideals ofhuman progress and development. In the end, the fundamental claim made here is that we now see, asperhaps we have not for some time, a deep complementarity in our ethical beliefs in areas in which we hadhitherto considered as engaging different values and contradictory commitments. The subject matters ofthis Global Report have gained in normative salience and relevance to our times.

This document is not an exercise in philosophical rumination as an end in itself. This criticalreappraisal of our thinking is part of what is required in order to fulfil the ambitions of the ILO Declarationon the Fundamental Principles and Rights at Work. Our goal of clarifying our thinking is in aid and supportof the purposes of the Global Report - “to provide a dynamic global picture ... and to serve as a basis forassessing the effectiveness of the assistance provided by the Organization and for determining priorities forthe following period ....” In turn, the Global Report as part of the follow-up mechanism in general, doesnot exist in a vacuum. It is designed to support the purposes of the Declaration itself. The Declaration is, atits roots, a recalling to fundamental constitutional ideals and purposes - constitutional duties which exist invirtue of ILO membership. These constitutional duties are not, and expressly not, the “specific rights andobligations in Conventions, even those “recognized as fundamental both inside and outside theOrganization”. Rather, the constitutional commitments to which the Declaration rededicates members areat the level of “fundamental principles and rights”.

The Declaration is a statement of institutional values but it is more than that. The purpose of theDeclaration is not only to articulate the fundamental principles and values of the ILO, but to recall that, invirtue of membership, there is a constitutional duty to “respect, to promote and to realize, in good faith andaccordance with the Constitution” those fundamental values expressed at the level of fundamental principleand fundamental right. Moreover, the Declaration recognizes not only obligations upon members, butobligations of the ILO itself to assist members in the realization of their constitutional commitment to thefundamental principles and fundamental rights. That is the project to which the follow-up mechanism ingeneral, the Global Report more specifically, and this effort to clarify our fundamental thinking in relationto the subject matter of the first Global Report, must be dedicated. Our fundamental thinking is then, in aidof providing a dynamic global picture which can serve as a basis for assessing effectiveness of ILOassistance to members, with a view to determining future priorities in that regard. Effective assessment andassistance can only be possible if it is erected upon a sound and clearly articulate normative foundation. Aclear understanding of what we are trying to do and why it is important to do it is a necessary preconditionto effective action. As Neitzsche is reported to have said, “the most common form of stupidity is forgettingwhat it is you are trying to do.”

But the ILO Declaration, primarily in its Preamble, is not silent on this foundational issue and doesstake itself to a set of normative claims - claims about the world and its values - about the economic, thesocial, the political and their complex interrelationships - and about the normative centrality of thefundamental principles and rights.


Moreover, and perhaps more importantly, the Declaration has made implicitly, and in its verystructure another normative claim. This is a claim that our commitment to the fundamental principles andrights remain in many ways aspirational and unrealized. It is a confession of at least partial failure, ofimperfect recognition and realization of those rights and principles. In short, it is a claim that we have somedistance to go in securing actual realization of those rights in the lives of citizens throughout the ILOworld. The purpose of the Global Report is to be one vehicle for crossing the chasm which yawns betweenour current condition and our constitutional commitments.

The claims made in the Preamble to the Declaration offer us our starting point for our fundamentalthinking about the current normative salience of the fundamental principles of freedom of association andthe right to collective bargaining. Our task here is not to justify post hoc what we have already said ordone, but to critically assess the currency of our thinking thus far and hold it to critical scrutiny. Our aimhere is to assess the true significance in these times, of freedom of association and the right to collectivebargaining. It is to understand why we are committed to those ideals. Only then can we effectively advancetheir cause. The claims made in the Preamble to the Declaration are of fundamental importance. The viewtaken here is that it is critical that we understand how correctly to interpret the claims made in thePreamble. This is because there are two very different ways of reading the normative claims contained inthe Preamble - one shallow and one deep.

The claims contained in the Preamble to the Declaration begin with the Constitutional reminder ofthe most fundamental of ILO beliefs – “that social justice is essential to universal and lasting peace”.Following this direct echo from the original 1919 Constitution, the Preamble goes on to make other claimsabout our understanding of the world:

• “Economic growth is essential but not sufficient to ensure equity, social process andthe eradication of poverty.”

• “... in the context of a global strategy for economic and social development,economic and social policies are mutually reinforcing components in order to createbroad-based sustainable development.”

• “In seeking to maintain the link between social progress and economic growth, theguarantee of fundamental principles and rights at work is of particular significance inthat it enables the persons concerned to claim freely and on the basis of equality ofopportunity their fair share of the wealth which they have helped to generate, and toachieve fully their human potential.”

• “... it is urgent, in a situation of growing economic interdependence to reaffirm theimmutable nature of the fundamental principles and rights embodied in theConstitution of the organization and to promote their universal application.”

The fundamental question is - how are we to read these claims? One view, the shallow view, is that theseclaims contain no challenge to a view which has dominated and structured much of recent public policydebate, both domestically and internationally, for some time. On this view there are two spheres - theeconomic and the social - which are segregated. The projects of economic and social development are seenas being autonomous and sequenced in a certain way. Economic growth is, on this view, a self-containedproblem, to be managed on its own terms, which if we are successful in that regard, will generate the assets


with which to purchase what might be viewed as a set of “luxury goods” in the social sphere, should we bemoved to do so. In practical terms this has resulted in an apartheid in policy debates between the economicand the social. On the shallow reading the claims contained in the Declaration's Preamble, declaring aconnection between the economic and the social, is merely pragmatic and strategic. On this shallow viewany perception of a “link” or a “mutually reinforcing relationship” between the two spheres is not basedupon any thing more than the perceived need to avoid a “backlash” among the world's populace basedupon the mal-distribution of the benefits and costs flowing from an integrated global economy. On thisview the normative foundations of the economic and the social are different, and indeed contradictory, andthe problem of governance is one of managing in a strategic way these fundamental contradictions. On thisview of the world the economic is prior to the social, and this sequencing results in a purely redistributiverole for social policy, rather than a role in creating economic success in the first place. Moreover, there isoften a “big trade off” between fairness and efficiency - one comes at the cost of the other. This is not aview held only by those pursuing the economic agenda. It is a view often shared by those in opposition,who also see a zero-sum game at stake, but desire a different outcome.

A second, and deeper view of the Declaration's normative claims in its Preamble rejects thisinterpretation. On this view the Declaration's Preamble accurately reflects a deeper understanding, recentlygaining recognition and affirmation. On this view there is not a segregation of the economic and the social,but rather an integration. On this view the economic is not prior to the social, and the social not simply aset of luxury goods to be subsequently purchased with the gains of economic growth. Rather, recognitionof fundamental social rights and principles is both and simultaneously the necessary precondition to, andthe goal of, human development. Our normative architecture does not rest upon two foundations, butrather one. Our normative commitments are not in contradiction and our task in managing them is notmerely a strategic one. Rather, our task is to be true to our deep human commitments which arecomprehensive and unified in nature. [This richer understanding reveals that, properly conceived, oureconomic and social goals cannot be traded off for they are the same.] This is not a triumph of the socialover the economic, nor of the economic over the social. It is about seeing both clearly. In what follows thecompelling nature of the deeper view is explored. To get at this deeper understanding of the normativeclaims of the Preamble involves going back to first principles, and sorting out our means from our ends.We are fortunate in these times to be offered a clear chance at this normative reassessment. But there is adanger, evident in the aftermath of Seattle, that as our need for clear thinking becomes more obvious,entrenched interests on both sides will dig in and become more blinkered. The task is to convince bothsides, hitherto segregated, that they share common ground.

The focal point of this normative re-evaluation is upon our commitment to the fundamental valuesof freedom of association and the effective recognition of the right to collective bargaining. Attaining adeep understanding of their role in our unified view of economic and social progress will ground and puton a sound footing both our description of the world contained in this report, and our make for effectiveformulation of plans of assistance to member states possible. [The three central claims examined below areas follows:

1. The fundamental principles of the rights of association and effective recognition of collectivebargaining are of increasingly profound importance in our beliefs about effective and sustainablehuman development. This is true not just as an academic matter, but as a real world, public policy,phenomenon. It is increasingly the case that these fundamental values are conceived as additional toand not just instrumental to, but constitutive of, human progress.


2. But we have a long way to go. Clarification of our fundamental normative thinking is but oneprecondition to effective realization of the constitutional aspirations to which the Declarationrededicates ILO members.

3. While we increasingly appreciate the significance of the recognition of the right to freedom ofassociation and collective bargaining, we live in a time in which effective advancement of theseconstitutional values is subject to new threats and challenges, but also ripe with new opportunities.Globalization, conceived of as deep economic integration, has both helped to bring forward ournew appreciation of the normative underpinnings of global economic development, but alsogenerated significant discontents. It is of critical importance that these discontents not conspire tocreate a roadblock to real global economic progress and reform.]

In the not too recent past these claims would have appeared as radical, and as radically incoherentas either a statement of reality or ambition. This is because in the latter part of the 20th century muchpublic policy has been informed by a view of the normative realm in which markets and market ordering,assumed a dominant ideological authority. The normative case for markets is largely perceived inconsequentalist terms in which the value of markets lies in their ability to maximize utility, most commonlyexpressed as efficiency, which in turn is most commonly expressed in terms of wealth, such as GDP percapita. Atomistic, self-interested individuals maximizing their own utility in a sparsely constructed space ofthe free market, will allocate scarce resources to highest valuing users thus maximizing overall benefit tosociety. At the domestic level this view found expression in a distrust of government, of the public, of thesocial (conceived of often as mere redistribution, structuring perverse incentives to productive marketactivity), of regulation, in short with any interference with the operation of the free market which was notaimed at correcting some defect in the process of the operation of the market itself. In the labour market inparticular this view demanded the rejection of much labour regulation, of much of the ILO's internationallabour code, on the basis that it constituted perverse public policy unless and to the extent that it could bedefended as legitimate legislative efforts to cure for market defects such as information asymmetriesbetween employers and workers. Traditional public defences of labour market regulation, in terms ofequitable redistribution, or the need to correct for “inequalities of bargaining power” were rejected both asstructuring perverse incentives or conceptually incoherent. Within the economic approach the idea ofinequality of bargaining power as a prime justification for freedom of association, unions, and collectivebargaining, is perceived as a simple misunderstanding of some fundamental tenets of economic theory. Onthis view, economic efficiency is perceived as the adequate indeed the dominant metric of social success.

At the international level this neo-classical or neo-liberal economic perspective found expression inwhat is often referred to as the “Washington Consensus” which held that good economic performancerequired liberalized trade, macroeconomic stability, and “getting prices right”. In essence this involvesdramatic shrinkage of the role of the state and the corresponding increase in the role of markets -sometimes simply put as “getting governments out of the way”. The typically mandated macroeconomicstabilization policy included expenditure reductions to eliminate or contain budget deficits and high rates ofinflation, exchange rate devaluations, trade and foreign investment liberalization, privatization of state-owned enterprises and de-regulation of price and entry controls in many sectors. On the more extremeversion of this view the whole project is to marginalize the state, confining its role to the facilitation ofmarkets through the construction of the space for private exchange by structuring property and contractrights adequately enforced. While the exact metes and bounds of the “Washington Consensus” is, perhaps,contested,1 its overall policy orientation is unmistakable. The Washington Consensus clearly represented 1 Naim, “Fads and Fashion in Economic Reforms: Washington Consensus or Washington Confusion?” IMF Conference onSecond Generation Reforms, November 1999.


the rejection of the post-war paradigm of what has been referred to as “embedded liberalism”2 in which thepursuit of full employment and a social contract or bargain between capital and labour, was abandoned. Onthis view institutions of labour market regulation, including the ILO, are perceived a part of the problemand not part of the solution.

The Washington Consensus constituted, in part, what has been called the “globalization of themind”. That is, it became the dominant paradigm for understanding how best to structure and react to theforces of globalization and economic integration. The Washington Consensus represents, again, a view ofthe link between the economic and the social, and a view of development, in which there are twoautonomous realms serving different and contradictory ends. The Washington Consensus makes possible aseparation of debates about economic progress, one the one hand, and progress on other dimensions suchas the democratic, the social justice, human rights etc. On this neo-liberal view these are, again, a set of“luxury goods”, which adherents to the Consensus will be better able to afford, should they wish to do so. However, there is a deep concern that adherence to the second agenda might well undermine the first orderagenda of economic progress.

The view taken here is that the segregated approaches to both domestic and international publicpolicy are deeply problematic, deeply shallow. They are deeply shallow because the error in this set ofviews rests not simply in some strategic and/or empirical miscalculation about the degree of socialsolidarity required to advance the agenda of economic progress, but because they rest upon a deepmisunderstanding of what human progress consists in.

It is important to note, immediately, however, that we are not alone in this view. We now live in anage in which the normative tectonic plates of the “Washington Consensus” and its domestic counterpart,are evidently shifting. We are at a time when discussion of foundational issues is possible. Architects of theWashington Consensus now openly discuss what a “post-Washington Consensus” might look like.3 We livein a world in which there is much discussion of a new approach to development - the ComprehensiveDevelopment Framework of the World Bank which is explicitly an integrated approach to our issues.Discussions of “second generation reforms” are the order of the day. These policy discussions now talkabout “integrated” and “holistic” approaches to economic and social development. Concepts such as “goodgovernance”, “social capital”, “legal capital”, and “process” are being discussed and analyzed as necessaryingredients of successful development. Institutions matter again. There is a richer understanding of the linkbetween the market and the institutions - both explicit and implicit - which structure it and in which it isembedded.

Much of this is encouraging, but also equivocal. There is a view still dominant in some of these newdiscussions that this new opening in our thinking, and these new ideas, amount merely to an understandingthat the Washington Consensus is necessary but not sufficient to achieve global justice. But that is a viewwhich is at home with a continuation of a segregation of the economic and the social and the perception ofthe link between them as being merely pragmatic and strategic. The view taken here is that in order to trulyunderstand the significance of these developments one must dig deeper. One must see that what isoccurring here not a mere addition to our agenda, not a mere discovery of an additional ingredient or twoto add to our recipe for successful development, but rather a reconceptualization of what development

2 Ruggie, “International Regimes, Transactions, and Change: Embedded Liberalism in the Postwar Economic Order”International Organization 36 (Spring, 1982) 195.

3 Stiglitz, “More Instruments and Broader Goals: Moving Towards the Post-Washington Consensus” WIDER Lecture 1998.


consists in. This involves a fundamental and deep reassessment of our ends and our means and thediscovery of a unity in realms hitherto considered separate and not part of a coherent whole.

In what follows our project is to provide this unified account of development and, in particular, therole of the fundamental value of the freedom of association and the institution of collective bargainingwithin that structure of thought. It is worth noting that this opportunity to undertake this fundamentalreevaluation at the end of the millennium occurs not in the same context as the other great moments inhistory of the ILO. Both in 1919 and in 1946 fundamental rethinking and new insight was forced upon usby the horrific costs inflicted upon the world as a result of the breakdown of international economic andpolitical cooperation. We do not now stand in the shadow of the cataclysm of a world war. Indeed oursituation is almost the opposite. We live in a world in which the “triumph of market capitalism” and the“defeat of communism” constitute the dominant features of our political landscape. Perhaps it is because ofthe end of basic ideological conflict that we are, however, at a moment when the foundations of marketcapitalism are available to be examined, clearly, unobscured by the fog of the old ideological debate andilluminated by the bright light of globalization. Thus, as the developing world continues to struggle withmarginalization, as developments in Russia continue to perplex, following the Asian crisis, and defeat ofthe MAI, and after recent events in Seattle, we are being forced and are offered the opportunity to clarifyour thinking about the nature and the relationship of social, political, and economic institutions.

What then is the deep, unified, understanding which is implicit in the developments we see allaround us at the turn of the millennium? What is the deep understanding of the normative claims containedin the Preamble to the Declaration? More specifically, how do the fundamental principles of freedom ofassociation and collective bargaining cohere with that unified understanding?

We can begin with the familiar observation that the values of freedom of association and collectivebargaining have found repeated global acceptance and reaffirmation in the fundamental internationalinstruments of this century. And they have found recent expression in international documents emanatingfrom Copenhagen, from Singapore and in the ILO Declaration itself. This repeated declaration ofallegiance and fidelity to the notion of the freedom of association is not just a political judgment, but anaffirmation of reality. This is because association is radically basic to not just humans, but humanness.Humans are social animals, not just in the sociological and political sense, and not just as a matter of factor as a matter of value judgment, but essentially. The basic institutions of humanity are such as they are notavailable to just one person. Language, for example, is of necessity a public and social institution. So too,are markets. To say that it is a good thing that people are social is rather like saying that it is a good thingthat they breathe oxygen. To say human association is a good thing is rather like saying that it is a goodthing that the earth's atmosphere contains oxygen. Association is not just a fact which happens to be true,nor an aspect of the desirable, it is a condition of our humanity. If we could completely eliminateassociation, we would not be human.

But freedom of association, is not only constitutive of the essence of humanity, it has as an aspectof freedom in general, the deepest normative salience for humans. This is a truth Nobel Laureate AmartyaSen has made so clear.4

The significance of Sen's contribution lies in its articulation of a deep and unified foundation for anintegrated view of human progress and development. In Sen's view human freedom is both the end of, anda crucial set of means to, human development. It is the destination and the way. Development is the very

4 Sen, Development As Freedom (1999).


process of expanding the real freedoms that people have. Our goal is not the construction of markets,global integration, nor macroeconomic stability, or increasing of GDP per head, nor the creation of anInternational Labour Code, for their own sake, but rather in the name of expanding capabilities for peopleto live longer, better, meaningful and productive lives. This is a substantive view of freedom which viewsfreedom as the real “capability” to lead lives “we have reason to value”. The process of development is theprocess of removing obstacles to this real human freedom.

As Sen points out, obstacles to human freedom come in a variety of forms:

Sometimes the lack of substantive freedoms relates directly to economic poverty, whichrobs people of the freedom to satisfy hunger, or to achieve sufficient nutrition, or to obtainremedies for treatable illnesses, or the opportunity to be adequately clothed or, sheltered, orto enjoy clean water or sanitary facilities. In other cases, the unfreedom links closely to thelack of public facilities and social care, such as the absence of epidemiological programmes,or of organized arrangements for health care or educational facilities, or of effectiveinstitutions for the maintenance of local peace and order. In still other cases, the violation offreedom results directly from a denial of political and civil liberties by authoritarian regimesand from imposed restrictions on the freedom to participation in the social, political andeconomic life of the community.5

Our fundamental project is the removal of obstacles to human freedom so conceived. This is thepoint of our public policy both domestically and globally. This is the one foundation stone of our normativearchitecture.

Sen's great achievement lies in his demand that we begin our thinking about development in humanprogress at the beginning - by sorting out our important goals from the means we use to achieve them. Thisis a basic and important point. It is unfortunately all too common in human history for social and politicalsystems to take on a life of their own, detached from the ends they were initially constructed to advance,serving in the end and sometimes terrifyingly so, only their own internal demands. Sen's starting point isrequired to break out of the dead end of such self-serving ideologies. As Sen puts it,

If freedom is what development advances, then there is a major argument for concentratingon that overarching objective, rather than on some particular means, or some speciallychosen list of instruments. Viewing development in terms of expanding substantivefreedoms directs attention to the ends that make development important, rather than merelyto some of the means that inter alia, play a prominent part in the process.6

But Sen's accomplishment is still greater. Not only does he remind us of our fundamental goal ofremoving sources of unfreedom, but he observes that human freedom is itself a means to the goal of humanfreedom and that there are interconnections - mutually reinforcing interconnections - between differentsorts of human freedoms. That is, while “what people can positively achieve is influenced by economicopportunities, political liberties, social powers, and the enabling conditions of good health, basic education 5 Sen, Development As Freedom p. 4.

6 Sen, Development As Freedom p. 3.


and the encouragement and cultivation of initiatives ...”, it is also true that “the institutional arrangementsfor these opportunities are also influenced by the exercise of people's freedoms, through the liberty toparticipate in social choice and in the making of public decisions that impel the progress of theseopportunities.”7

So, for example,Political freedoms (in the form of free speech and elections) help to promote economicsecurity. Social opportunities (in the form of education and health facilities) facilitateeconomic participation. Economic facilities (in the form of opportunities for participation intrade and production) can help to generate personal abundance as well as public resourcesfor social facilities. Freedoms of different kinds can strengthen one another.8

This is not a view which is in any way antithetical to the value of market ordering of human affairs,and it would be indeed strange if a theory of freedom were so. Rather, it is a unified view which urges us tosee free markets as part of the goal of expanding human capacities in general, and as an important means tothat end. It is, in fact, a vital reminder of the moral foundations of markets - of the core values on whichthey are constructed and which they serve. Markets are the often defended in terms of their consequences.On our view there is a common grounding for economic policies and social policies, which is prior to theirconsequences and rests on the inherent value of human freedom. The economic and the social stand incommon cause, not in autonomous realms. They cohere in support of our overall objective, they do notstand in contradiction. We do not have a strategic or pragmatic problem in balancing our fundamentalobjectives and they are not to be sequenced or traded off. The relationship between the economic and thesocial is not a zero sum game, because they are one.

This does not mean that the project of expanding human freedom is a simple one, or that complexempirical questions and policy judgments of how best to structure institutions and allocate scarce resourcesare solved. Our unified view does not solve our problems - it lets us understand them. [We cannot solveour problems unless we understand them.] What our view does is help us see clearly what we are doingwhen we engage our overall project. This is because this view provides a fixed star in our normativefirmament without which there is no method of evaluating policies, either in terms of process or of result,and no way of ascertaining when our means have become self-fulfilling and detached from their truepurpose. This normative framework will not provide a map for policy design - a highly unlikely possibilitygiven the embeddedness of our social and economic institution in different histories, cultures andgeographies - but it does provide the compass.

With this compass we are able to avoid asking the wrong questions, to avoid taking epiphenomenaas our central problems, to see the rich interconnections of social and economic structures and to sort outour priorities. For example, the literature on development has spent much time addressing the relationshipbetween democratic freedoms and economic growth. These empirical studies have yielded mixed resultswith some finding that democracy promotes, other that it reduces, and others that it has not statisticallysignificant impact on economic growth. Leaving aside an assessment of these studies on their own terms,our important point is that on the integrated view, their problem lies not in their statistical disagreement orlack of empirical clarity, but in the conceptual confusion contained in the question. They seek to answer thequestion posed by these studies is possible only if we have lost our compass. The question, as a result,

7 Sen Development As Freedom p. 5.

8 Sen, Development as Freedom p. 11.


misses several crucial points. First, it focuses upon the wrong dependent variable - economic growth -which is a means to our overarching end. Second, it misses the point that democratic freedoms are in andof themselves constitutive parts of our goal. Their importance is not vindicated only by their contributionto economic progress. Finally, those who ask this question in this manner have forgotten the most basicpoint about the significance of market institutions. To focus solely upon the consequence of marketsexpressed in terms of efficiency outcomes is to miss their foundational normative significance - to fail tosee that market freedom is a dimension of human freedom. The fundamental defence of markets rests uponhuman autonomy and freedom of choice. Preferences not generated in circumstances of human freedom arenot expressions of human autonomy and carry no normative weight whatsoever. Any calculation socialpolicy calculation based upon this input is built upon normative sand.9

It is in this light that we can best understand the identification of the core labour rights singled out,identified, and affirmed in the ILO Declaration. This is not a random selection of subjects of interest to theILO. They have an internal rationality when considered as a whole, and this can only be appreciated inlight of our overarching goal of expanding real human capabilities and removing obstacles to humanfreedom. The fundamental rights of freedom of association and the effective recognition of the right tocollective bargaining, the elimination of all forms of forced or compulsory labour, the effective of theabolition of child labour, and the elimination of discrimination in respect of employment and occupation,are importantly understood as seeking to establish the basic conditions of labour market exchange onconditions of freedom. They are concrete expressions of the normative foundations of the most basicvalues forming the bedrock of economic theory and market ordering - human autonomy and freedom.[This is unquestionably the case regarding forced and compulsory labour, child labour and the eliminationof discrimination. In some circles freedom of association and collective bargaining will be viewed morecritically as potentially serving to interfere with human liberty as well as promote it. This view is discussedbelow.] These basic human rights and market ordering share the same normative space.

There is a deep complementarity between market ordering, the ILO Declaration, and human andsocial development. But this is because they are identified and coherently brought under the overarchingvalue identified by our normative compass that is in virtue of their constitutive contribution to ensuringhuman freedom directly, and their instrumental role in advancing the cause of other human freedoms.

The core labour rights represent the most basic level of freedom of association - the ability to enterthe labour market on terms of freedom. A freedom based perspective demands that we focus upon thistruth, something which theories of development which focus only upon outcomes often overlook. Thefixed star of on our overarching goal also forces us to recognize that as important as true market freedomsare, both as ends and means, other economic, social and political freedoms play crucial roles in enhancingthe lives that people are able to lead.10 To truly take freedom seriously we must, as Sen says, take it as asocial commitment.

There is another and broader dimension to this discussion of the link between economic growth anddemocracy. It might be argued that if within a non-democratic, authoritarian regime the core labour rightswere respected, we could then ask our question about the relationship between efficiency and democracy,Leaving aside the point already addressed that this misses the overall objective of advancing human

9 M. Friedman, Capitalism and Freedom (Chicago, 1982).

10 In particular, it is necessary to pay attention to what Sen identifies as five other types of freedom: political freedoms,economic facilities, social opportunities, transparency guarantees, and protective security.


freedom and undervalues the constitutive value of democratic freedom itself, it still reveals deeply flawedthinking about the ways in which markets are significant enhancers of human freedom. The basic normativequestions relevant to market ordering go beyond those addressed to the legitimacy of any individualbargain within the domain of the market. The questions raised involve the question of market domain itself.The connections between political freedoms and economic arrangements are much more complex thansimply solving for non-coercive forces within the marketplace. The relationship between market orderingand political freedoms is more far reaching. Market freedoms are an aspect of human freedom, but whetherthere is a market in health care, in education, in human embryos, in public office, in basic necessities, insocial roles, are questions of political and institutional arrangements which are not answerable within thebounds of economic theory. These are questions about markets. They are questions about when to deploymarkets as institutions to enhance human freedom. It is necessarily the case that these questions aboutwhen to deploy markets are not answerable solely from within market theory. Moreover, the richdifferentiation and actual instantiations of market policies, labour market policies in particular, indemocratic nations reveal a rich variety of political choices to be confronted. These are choices which notonly which have to be made - but which are, more profoundly, simply made available or not made availableas choices, in light of social, economic, cultural historical factors. There is no reason to give credence topreferences or choices on such issues constructed or imposed by authoritarian regimes. Assessments ofeconomic choices made in such circumstances - taking them at face value - is to ignore our fundamentalreasons for taking preferences seriously in the first place. Freedom, and democratic rights of association,are critical not only to choices in the marketplace, but to choices about the marketplace itself. Freedom ofassociation is, then, on our view both an end in itself as a constitutive human freedom and interconnectedwith the provision and structure of other freedoms and social arrangements which promote them.

It is in this light that we should understand the well observed phenomenon that in fact withinauthoritarian regimes there seldom exist the full set of fundamental freedoms set out in the Declaration,especially freedom of association and collective bargaining. This has been because there is a realconnection between what is called “horizontal” freedom among members of a society and “vertical”freedom between citizens and the state. This is the lesson of Vaclav Havel's parable of the shopkeeper whoputs up a slogan congenial to the authoritarian in his shop window,11 and well explained by Hirschman,

Horizontal voice is a necessary precondition for the mobilization of vertical voice. It is theearmark of the more frightful authoritarian regimes that they suppress not only verticalvoice - any ordinary tyranny does that - but horizontal voice as well. The suppression ofhorizontal voice is generally the side effect of the terrorist methods used openly by suchregimes in dealing with its real and imagined enemies. For once, this side effective isintended: it is greatly welcomed by regimes who hope to gain in power and stability by thusconverting citizens into isolated, wholly private, and narrowly self-centred individuals.12

Havel's and Hirschman's lesson is that, as is well known, self-interested atomistic behaviour canunder-produce the socially optimal because authoritarian regimes can successfully divide and conquer bypitting individual citizens competitively against one another. Here co-operation and association was and isrequired to break the die of oppression and unfreedom. But how do we know that collective action - co-operation among individuals - is required here - is a “good” thing? Does not market theory predict

11 V. Havel, “The Power of the Powerless” in Living in Truth (Faber, 1987).

12 Hirschman, “Exit and Voice: An Expanding Sphere of Influence” in Rival Views of Market Society (Harvard, 1992) 82.


collusion will lead to suboptimal results?13 The real reason we know the answer is that we have anindependent and external criteria for normative judgment. This is what is always required in our judging ofhuman institutions, and this is what the unified view provides. Our normative touchstone, our compass, isthat we understand our project to be that of removing obstacles to real human freedom conceived of as thecapability to lead lives we have reason to value. With this compass in hand we are at last equipped toassess our institutions in correct perspective, and much more likely to be able to plot the complexinterrelationships of various freedoms and social and political arrangements. It enables us to know whenand on what general terms co-operation or competition may be required.

These general reflections lead naturally to a more detailed consideration of freedom of association,and, in particular, the effective of the recognition of the right to collective bargaining. There is a naturallink between the core labour rights in general, conceived of as a set with a unifying rationality, freedom ofassociation as a fundamental political ideal, and freedom of association expressed as the right to collectivebargaining. But the lesson of Havel and Hirschman is critical here. Judgments about when both competitionand co-operation are beneficial is always a judgment to be informed by our overarching goal.

Increasing economic integration clearly poses new challenges for the right of freedom ofassociation and the effective of recognition of the right to collective bargaining. These new pressures arecomplex and expressed in contradicting metaphors of integration and, at the same time, disintegration. Thelanguage of global economic integration is one of broadening, of expanding, of the need to attend to lesspartial, less parochial factors. It invokes the image of homogenizing global forces which pull us towardscommon and broadbased solutions. But the metaphor of disintegration is equally relevant and finds itexpression in the images of fragmentation of traditional patterns of long term employment, of thesplintering workers groups by the politics of gender, race, etc., of the rise of new and difficult to organizesectors of the economy, of increased marginalization of workers in the developing world, of the informalsector, and in the realization that traditional methods of regulation are inadequate and that domesticsovereignty is fractured and inadequate. These difficulties for effective recognition of the right to collectivebargaining in this context are discussed below [by someone else].

Our questions here are more fundamental. Even if we accept the value of human freedom and thegeneral political value of freedom of association, what is the normative salience of freedom of associationconnected to the right to collective bargaining which would underwrite the declarations' dedication toeffective recognition of that right? We are not here concerned with any of the more particular questionsabout the rich variations in actual structures or levels of collective bargaining, rather with the effectiverecognition of the right to collective bargaining considered at the level of fundamental right and principle.Nevertheless, at this level any society must be able to provide, and the ILO must be able to provide, ajustification for its answer to the question whether it should oppose, tolerate, or protect freedom of peopleengaged in productive activity to associate collectively in order to bargain about the terms upon which thatproductive activity will take place. The Declaration stakes itself to the principle of freedom of association,not just in the abstract, as we have discussed, but in this particular fundamental instantiation at the core ofthe ILO's historical mandate. There is a constitutional commitment to its effective recognition.

Under our overarching understanding of the Declaration's commitments our understanding offreedom of association of collective bargaining lies, again, in seeing their contribution as a constituentelement of human freedom, and also in the complex interactions of these rights with other human freedoms

13 It is no use here to revert to technical discussions of “public goods” in an effort to find an answer within the confines ofeconomic theory, because we will need still to distinguish between public and public “bads”.


and the provision of social arrangements conducive to the production of, and removal of obstacles to,human freedom.

At its most elemental level freedom of association by those engaged in productive activity is simplya particular instantiation of the general human freedom to associate. Freedom of bargaining is also anelemental freedom and as such a constituent element of human freedom. At a most basic level then, there isa straightforward case for our commitment under our overarching goal to the promotion of association andbargaining. Objections to collective bargaining do not, for the most part, focus upon association andbargaining as expressions of fundamental human freedom, but rather upon consequences, especially interms of efficiency. The neo-classical view of collective bargaining is as a zero sum game, in which unionsconstitute a monopolistic device for raising wages above the market clearly equilibrium level, reducingefficiency and output. Much the same market meddling view is taken of other aspects of labour regulationas well. This monopoly view has, however, been the subject of extensive theoretical and empirical study forsome time. In fact the impact of unions upon organized firms is now recognized as more complex anddynamic than the monopoly view suggests. The productivity and efficiency enhancing impacts of unions aresignificant and offset increase costs in many cases. But this consequential defence of collective bargaining,while significant, misses the point to which our unified view of the Declaration, and our basic normativecompass directs us - that is, the question of human freedom. The mechanism by which unions producethese efficiency gains is widely viewed to be through the device of the exercise of another freedom - whatAlbert O. Hirschman famously identified as “voice”, as opposed to “exit”. Voice is primarily understood asthe political alternative to the market mechanism of exit and is the key to understanding the non-instrumental conception of collective bargaining as a form of democracy. Of course, it would be a mistaketo equate voice solely with freedom. Both exit and voice are “complimentary ingredients of democraticfreedom”.14 But collective exercise of democratic voice is at the core of human freedom in the modernworld.

The question of whether a model of individuals exercising individual choice and exit themarketplace, or whether a model collective and cooperative use of voice is to be preferred, is as always aquestion which can only be answered in light of whether it promotes our overarching goal - theenhancement of human freedom. This is the best understanding of traditional defences in collectivebargaining in terms of “unequal bargaining power.” Assertions of unequal bargaining powers are not meantto be statements within the discipline of economics or internal to our conception of markets. Rather it ismeant to be a provocative critique and pointing out of the limitations of, in some circumstances, individualexercise of choice and exit. This is the method necessary to understand the plight of Havel's isolated andalienated shopkeeper. Whether collective voice is required, or whether collusion is to be prohibited, canonly be determined by reference to an external normative touchstone. Where some analysts will see,correctly, a well ordered private market, others will see, correctly, a collective action problem. Thequestion of which mode of analysis is correct cannot be, conceptually, determined by the intellectualresources available, internally, to either view. These debates are not answerable from within the limitedresources of their own analytics, but only by reference to a substantive normative commitment. Theoverarching normative commitment of the Declaration is that free association and collective bargaining are,and have been, significant enhancers of human freedom. The democratic process of self-organization,institution building and maintenance, democratic determination of bargaining priorities, are simply exercisesin democratic freedom that no employer no matter how benevolent can bestow. The ongoing processes ofself government cannot, by definition, be imposed or provided by others.

14 Hirschman, “Exit and Voice: An Expanding Sphere of Influence” supra note 12.


The significance of free association and collective bargaining by workers has also, as our viewwould predict, complex interconnections with other freedoms and social arrangements bearing out itssignificance not simply as a freedom in and of itself, but as a means to other freedoms and societalarrangements. Recently available analyses of the differential responses of various nations to the Asianfinancial crisis by Lee15 and Rodrick 16 point to complex preventive and curative roles played by organizedlabour. In part these studies bear out the logic of one of Sen's famous observations - that famines do notoccur in democracies. But these studies go further in their observations about the roles of unions andcollective bargaining as part of a larger story about the role of democratic institutions in general in ourunderstanding of both the causes of and the reaction to, significant financial disruptions.

Moreover, the complex interplay of the various human freedoms in general and freedom ofassociation and the right to collective bargaining in particular, is increasingly understood not simply in theirrelevance to traumatic economic disruptions, but to the evolutionary process of development itself. At theheart of this new appreciation, increasingly and explicitly articulated by the Bretton Woods and otherinternational and global institutions, is the idea that free human participation is both an end in itself andimportant means to securing sustainable progress. The robustness of the connections betweenparticipation, freedom of association, the existence of free and viable trade unions, on the one hand, anddevelopment, is comprehensive and multifaceted. Unions and institutions of collective representation areincreasingly seen and understood not just as institutions dedicated to their express articulated goals, buthaving general and beneficial side effects which have been identified and analyzed for the number ofanalytical perspectives. Foremost among these would be the increased appreciation of the role ofinstitutions and in particular institutions of conflict management. As Rodrick puts it:

Healthy societies have a range of institutions which make ... colossal coordination failuresless likely. The rule of law, the high-quality judiciary, representative political institutions,free elections, independent trade unions, social partnerships, institutionalized representationof minority groups and social insurance are examples of such institutions. What makes thesearrangements function is institutions of conflict management is that they entail a double“commitment technology”: they warn the potential “winners” of social conflict that theirgains will be limited, and they assure the “losers” that they will not be expropriated. Theyintend to increase the incentives for social groups to cooperate by reducing the payoff tosocially uncooperative strategies.17nn

In connection, trade unions and the institutions of collective bargaining are also understood asprime sites, and at the same time generators, of “social capital”, are “civil society”. Finally and morecomprehensive is the understanding of participation as an essential element of sustainable development. Ifdevelopment is viewed as a “transformation” of society then participatory processes are important on annumber of dimensions, and in complex interconnected ways.18 The core insight is that development 15 Lee, The Asian Financial Crisis (ILO 1998).

16 Rodrick, The New Global Economy and Developing Countries: Making Openness Work (Overseas Development Council,1999)

17 Dantni Rodrick, “Institutions for High-Quality Growth: What They Are and How to Acquire Them”, IMF Conference onSecond General Reforms (November 1999) p. 8.

18 Stiglitz, “Participation and Development: Perspectives from the Comprehensive Development Framework” (February 27,1999).


involves at its core a transformation in the way people think about change and human agency. In thisperspective, participation and voice not only legitimize policy decisions by securing the consent of thegoverned, not only make them more durable by securing the political “buy-in”of those who will live bythem, but is essential to the very idea of development understood as a “transformation”. This sort oftransformation of a society in its orientation to the world is definitionally only possible with theparticipation of the members of that society.

The empirical data continues to mount to confirm our deep and long held intuition that justice andfreedom are not the enemies of economic development and social progress. Freedom of association andthe effective recognition of the right to collective bargaining are now increasingly confirmed not only asvaluable aspects of human freedom in and of themselves, but as contributing in complex ways, perhaps notof all which we yet understand, to the reinforcement of other human freedoms and to a world which is boththe result of, and the necessary precondition to, real human freedom.

The deep truth of Sen's insight is increasingly clear and widely accepted - “the overall achievementsof the market are deeply contingent of political and social arrangements”.19

The Declaration, and its commitment to the fundamental principles and rights in general, and tofreedom of association and collective bargaining in particular, is best understood as expressing the ILO'soverarching commitment to human freedom. This is a comprehensive expression of the ILO's core beliefthat “labour is not a commodity”. But this unifying overarching view also expresses a “new global ethic”20

which informs not only the ILO's self-understanding of its role and mandate, but sees it as increasinglycoherent with the self-understandings, mandates, and programmes of other global institutions. One of thesignificant advantages of this view will be to affirm that debates about a “new international financialarchitecture” and “new international social architecture”, will have to be seen as an express in a morecoherent call for what may be called a “new international normative architecture”.

It is this understanding of the rights of freedom of association and collective bargaining whichunderlies this Global Report's dynamic assessment of these fundamental rights, and which informs itsjudgments about how best to advance their cause.

19 Sen, Development As Freedom 142.

20 Human Development Report 1999 (UNDP) p. 97.

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